Economic Theories and Customer´s Behaviors

For companies to be able to market products or services effectively, an understanding of how consumers behave and make decisions is necessary (Poon and Joseph, 2001). There are several theories that relate to this area, including economic theories as well as psychological theories. Earlier studies in theories concerning consumer behavior were developed through economic theory, for example the conception where consumers advance rationally to make best use of their satisfaction in the process of buying. More recent research shows that consumers are influenced by different types of reference groups, such as family, friends, advertisers and role models. Terms like impetuous purchase, mood, situation and emotion are applied more commonly in concerns concerning the behavior of consumers. All of these factors together form a complete model of consumer behavior that portrays both the cognitive and emotional aspects of consumer decision-making (Solomon et al., 2009). Assael (1994) explains consumer behavior as the process of recognizing and assessing various components of a purchase and further explains that there are two wide influences that decide consumer’s preferred choice.
Firstly, the individual consumer’s wants, awareness of brand distinctiveness and consciousness to alternatives are of significance in consumer decision-making. Other factors which affect the brand choice are the consumer’s demographics, peer pressure, lifestyle and personal characteristics. Secondly, the environment has importance in consumer behavior, which consists of culture, social class and various groups. Assael (1994) also describes the reason why information about consumer behavior is imperative for a company like ZARA to be aware of, which can thereby imp...

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...tomers’ queries in time. Being responsive implies a company should be accessible and willing to look into clients needs within the shortest time possible. ZARA has achieved this since its products were shipped directly from the central distribution center to well-situated, good-looking stores twice a week, doing away with the requirement for warehouse and keeping inventories low (Christopher et al., 2004). Companies and business ought to always put themselves in their customers’ shoes and endeavor to get their perceptions and their thoughts about the products provided the ‘given company. This quality of being compassionate is very imperative and helps in motivating customers. It involves listening keenly and asking the pertinent questions, speaking customers’ language, and tailoring products to satisfy or meet the customer the best way possible (Niinimäki, 2010).